Beijing Automotive Industry Corp is poised to announce a merger with Fujian Motor Industry Group that will cement its bid to become the mainland's fourth-largest carmaker, according to sources.
All that remains to be finalised after Beijing Auto reportedly raised its offer price from 500 million yuan (HK$567.15 million) to 700 million yuan, said the source, is the shareholding structure of the merged entity. The possible tie-up could then be officially unveiled later this month.
Fujian Motor, wholly owned by the provincial branch of the State-owned Assets Supervision and Administration Commission, is a partner of Japan's Mitsubishi Motors and makes commercial vehicles with Germany's Daimler in Fuzhou.
The company also has an agreement with Taiwan's China Motor (Zhonghua Motor) to sell its vehicles on the island.
Beijing Auto is the mainland partner of Hyundai Motor and assembles Benz cars with Daimler in Beijing.
The company is also aggressively looking at acquisition opportunities in Europe, such as General Motors units Opel, Saab and Volvo, because it sees overseas buyouts and domestic mergers as the quickest routes to expanding its operating scale.
A spokesman for GM China said Beijing Automotive had submitted a non-binding offer for German carmaker Opel late on Thursday, just before a deadline for prospective buyers, according to the Guangzhou Daily.